Market Crashed & SPACs
Sep 22, 2021
On Market Front
TRACKING KSE-100
So far this week KSE100 index lost 1038 points to close at 45,597 points. On Wednesday, the KSE100 index crashed 1220 points due to investors delayed response to the monetary policy, foreign & institutional clients selling stocks, and security concerns afters New Zealand & England cricket teams canceled their tour to Pakistan. However, by the end of the day, KSE100 recover half of its losses and closed 411 points in negative.
SPAC, TO THE MOON!
To improve the listing activity of new companies on the Pakistan Stock Exchange, SECP has amended the Public Offering Regulations, 2017. SPAC will give a boost to the primary market, encourage new listings and help companies tap capital for large-scale merger/acquisition transactions
WHAT’S UP WITH K-ELECTRIC?
Pak Suzuki Motor Company (+0.51%) will be discontinuing its 2nd Generation Swift variant in Pakistan almost 12 years after its launch, while bookings for the Cultus have also been temporarily suspended. Rumors are that Indus Motor Company (-0.04%) that assembles Toyota cars in Pakistan plans to launch a Special Edition of the variant of the Toyota Corolla X 1.6.
On Economic Front
TECH EXPORT BOOM
Pakistan’s technology exports have increased by 81% in August 2021 over the same month last year. During the month under review, technology exports were recorded at USD 224mn. If the growth trend continues, it will reduce the pressure from the rising current account deficit.
NO MORE 007
The SBP increased the policy rate by 25bps taking it to 7.25%, after keeping it unchanged for almost a year. The economic recovery exceeded the central bank’s expectations since the last monetary policy meeting in July 2021, which hinted at a robust demand, leading to a rising current account deficit. SBP is likely to closely monitor the inflation outlook given the real wage growth and higher fuel, electricity, and commodity prices before making any adjustments in the monetary policy stance.